Gold Rate Today (August 16): Gold, silver gain as US data bolsters hope of rate cut in September; silver zooms over Rs 2000/kg today

Gold Rate Today (August 16): Domestic gold futures were trading on a positive note as the latest US data boosted hopes of a rate cut by the US Federal Reserve in September. At around 9:46 am, gold October futures were up 0.31 per cent or Rs 217 at Rs 70,353 per 10 gm. Silver September futures, meanwhile, traded with significant gains of over 2 per cent or Rs 1,909 at Rs 81,970 per kg.

The gains come off even as traders await Fed Chair’s speech due next week which would offer cues on the quantum of the likely rate cut. 

COMEX Gold meanwhile traded on a muted note with a negative bias at $2,490.2, down 0.09 per cent.

In the international market, Gold rose above $2,450 per ounce in overnight trade after remaining volatile in the previous session, as investors continued to assess global macro cues including the latest retail sales report and Jobless claims led to the major volatility in international markets yesterday. The precious metal also faced pressure as the United States (US) Census Bureau reported that monthly Retail Sales expanded at a faster-than-expected pace in July. The Retail Sales data, a key measure of consumer spendings that drives inflationary pressures, rose strongly by 1%, from expectations of 0.3%. Sales at retail stores were however contracted in June by 0.2%, downwardly revised from a flat performance.

However, markets continue to bet that the Fed will start lowering rates in September; however, the rebound in monthly consumer inflation dampened expectations for a larger rate cut next month due to higher costs in shelter and transportation services. This also trimmed the strong momentum for gold prices on Wednesday because of bullion’s relationship with interest-bearing assets. Meanwhile, the metal continues to benefit from its safe- haven appeal amid the Middle East conflict, with investors remaining anxious about Iran’s potential retaliatory strike on Israel, added Neha Qureshi, Senior Technical & Derivative Analyst, Anand Rathi Commodities & Currencies.

Outlook on gold 

Qureshi remarked that surprisingly lower Initial Jobless Claims for the week ending August 9 have also strengthened the US Dollar and bond yields which could cap sharp upside in the bullion. Meanwhile, macro cues including US housing numbers and consumer sentiments could provide fresh direction to prices in evening trade today amid geopolitical development in Iran & Russia.

How to trade gold and silver on MCX?

Qureshi suggests to sell gold October futures on rise around Rs 70,400 keeping a stop loss at Rs 70,900 with a target of Rs 69,700 per 10 gm. For silver, the analysts suggests to buy Silver September futures on dips at a price of around Rs 82,000 for a target of Rs 84,000 keeping a stop loss of Rs 81,000 per kg.